Three whistleblowers who exposed a massive insurance fraud and helped secure a $1 billion bankruptcy court settlement aren’t entitled to any of that money, according to an SEC decision being challenged in two federal lawsuits.
The whistleblowers worked with the Securities and Exchange Commission for years and provided information that “significantly contributed” to the successful sanctioning of a Texas viatical company, the SEC wrote in a March 27 final order. But because the money was recovered through a bankruptcy proceeding, the law as written means the whistleblowers can’t be paid, the commission ruled.
Source: Whistleblowers Who Exposed $1 Billion Fraud Denied SEC Windfall
